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Wire

RPM's Pricing Power, Cost Savings Create Attractive Setup, UBS Securities Says

RPM International's (RPM) pricing power in the current inflationary cycle, favorable end market exposure and cost savings create an attractive setup, UBS Securities said in a note Tuesday.Analysts said they expect spending outside the residential housing market to improve in H2, as well as an increase in manufacturing and industrial-linked capital spending, which are likely to boost RPM's sales volumes in the Performance and Construction segments.Lower inflation for raw materials and a faster pricing response may limit margin decline in fiscal 2027, the brokerage said, adding that RPM's margins could expand by about 200 basis points in fiscal 2028 as pricing picks up and costs of raw materials decline, driving an earnings per share growth of roughly 22%.RPM is set to present a cost savings plan in the next few months, which UBS believes would aim for lower selling, general, and administrative expenses and target earnings before interest and taxes margins of around 16%.The brokerage increased its estimates for fiscal 2027 and 2028 adjusted EPS by 9% and 4%, respectively.UBS upgraded RPM to buy from neutral and raised the price target to $130 from $118.Shares of RPM were up more than 3% in Wednesday trading.Price: $106.39, Change: $+3.49, Percent Change: +3.39%

$RPM
Research

UBS Upgrades RPM International to Buy From Neutral, Raises Price Target to $130 From $118

RPM International (RPM) has an average rating of buy and mean price target of $128, according to analysts polled by FactSet.(covers equity, commodity and economic research from major banks and research firms in North America, Asia and Europe. Research providers may contact us here: https://www..com/contact-us)

$RPM
Wire

RPM to Continue 'Solid' Mid-Single Digit Growth in Construction Products, Performance Coatings Businesses, RBC Says

RPM International (RPM) is expected to continue posting "solid" mid-single digit percentage growth in its Construction Products and Performance Coatings businesses, offsetting flat to lower-single digit percentage declines in its Consumer segment, RBC Capital Markets said in a Wednesday note.The momentum is Construction Products business is expected to further continue in the company's fiscal 2027 supported by its share gains and focus on integrated turnkey solutions, whereby customers use RPM for design, installation, and ongoing maintenance and warranties, RBC said.With the company expected to see 1% to 2% inflation in fiscal Q4, and another 6% to 8% in fiscal Q1, RPM is implementing price increases to recover margins, RBC said, adding that Construction Products and Performance Coatings businesses can raise prices faster than the Consumer segment.RBC said it thinks RPM can generate about $600 million of free cash flow in fiscal 2026 and expects the company to spend $225 million to $235 million in fiscal 2026 capital expenditure and pay out about $300 million in dividends.The bank maintained its outperform rating on RPM with a $130 price target.Price: $106.31, Change: $+1.16, Percent Change: +1.10%

$RPM
Research

Research Alert: CFRA Maintains Buy Opinion On Shares Of Rpm International Inc.

CFRA, an independent research provider, has providedwith the following research alert. Analysts at CFRA have summarized their opinion as follows:We decrease our 12-month target price by $3 to $127, or 20.4x our FY27 (May) EPS estimate, which is in line with RPM's three-year average forward P/E of 20.5x. We trim our FY26 EPS estimate by $0.06 to $5.54 and increase our FY27 EPS forecast by $0.02 to $6.22. Geopolitical tensions in the Middle East present near-term headwinds through raw material inflation, expected at 1-2% in Q4 FY26 and mid- to high single digits in Q1 FY27. However, RPM is implementing pricing actions and leveraging its strategic procurement capabilities to mitigate cost pressures. The company reaffirmed Q4 guidance for mid-single-digit revenue growth and low- to high-single-digit adjusted EBIT growth. RPM's structural advantages remain compelling: two-thirds of sales are tied to maintenance, repair, and restoration markets, which prove resilient during economic volatility. The Construction Products and Performance Coatings segments continue gaining share through system-selling approaches and high-performance building solutions.

$RPM
Wire

RPM International's Long-Term Contracts, Price Escalators Insulate from Middle East Uncertainty, RBC Says

RPM International's (RPM) long-term contracts and price escalators help insulate it against near-term Middle East-related uncertainty, RBC Capital Markets analysts said in a note emailed Monday.Analysts said that conflict stability could help drive RPM to the higher end of its fiscal Q4 EBIT guidance growth of between low-single digit and high-single digit, but a prolonged conflict could lead to the lower end.RBC said that RPM's strong underlying quality, $100 million in annualized SG&A savings in fiscal Q3, and emphasis that its Middle East business accounts for less than 4% of sales, are "impressive."Analysts raised the company's fiscal Q4 and fiscal 2026 earnings per share estimates to $1.81 and $5.45 from $1.73 and $5.15, respectively.RBC has an outperform rating on the stock and increased its price target to $130 from $126.Price: $107.34, Change: $-1.86, Percent Change: -1.70%

$RPM
US Markets

RPM Beats Fiscal Third-Quarter Estimates, Affirms Sales Growth Expectations

RPM International's (RPM) fiscal third-quarter results topped market expectations, while the specialty coatings manufacturer reiterated its sales growth outlook for the ongoing three-month period.The company on Wednesday reported adjusted earnings of $0.57 per share for the quarter ended Feb. 28, up from last year's $0.35, which was the consensus on FactSet. Sales advanced 8.9% to $1.61 billion, topping the Street's view of $1.55 billion.The stock jumped 12% in Wednesday trade, taking its year-to-gain 4.8%. RPM is the parent of brands including Varathane, which offers wood-finishing products."In a period of volatile market conditions, we generated volume growth and record sales by utilizing our competitive strengths and nimbly focusing on growing end markets," Chief Executive Frank Sullivan said in a statement. "We demonstrated our ability to combine growth with efficiency, leveraging higher volumes to expand margins across all segments."RPM continues to project fourth-quarter sales to increase by a mid-single digit versus the prior-year period. The Street is looking for $2.17 billion."We expect to grow sales and adjusted (earnings before interest and taxes) again in the fourth quarter and deliver record results, even as we face more challenging comparisons and geopolitical uncertainty in the Middle East adds cost and complexity to the operating environment," according to Sullivan.The US and Iran on Tuesday agreed to a two-week ceasefire. The war, which began at the end of February, spread across the Middle East and curtailed shipments through the crucial Strait of Hormuz, driving up energy prices.The company is seeking to mitigate higher raw material costs and ensure supply, while implementing pricing actions to offset the remaining cost headwinds, Sullivan said.In the third quarter, sales in the construction products segment climbed nearly 11% to $546.7 million, driven by the company's North American businesses. The performance coatings division saw revenue increase 8.4% to $496.8 million, while the consumer business improved 7.9% to $564.5 million.Price: $108.69, Change: $+11.98, Percent Change: +12.39%

$RPM
US Markets

Stocks Rise, Oil Declines Pre-Bell as US, Iran Agree to Two-Week Ceasefire

US equity futures were pointing higher on Wednesday while oil prices fell as the US and Iran agreed to a two-week ceasefire, potentially paving the way for the reopening of the crucial Strait of Hormuz.The S&P 500 rose 2.6%, the Dow Jones Industrial Average increased 2.4% and the Nasdaq advanced 3.3% before the opening bell. The S&P 500 and the Nasdaq finished the previous trading session in the green, while the Dow closed lower.In a social media post on Tuesday, President Donald Trump announced that he agreed to suspend "the bombing and attack of Iran for a period of two weeks" based on conversations and requests from Pakistan's Prime Minister Shehbaz Sharif and Field Marshal Asim Munir. The suspension of hostilities is subject to Iran agreeing to the "complete, immediate, and safe opening" of the Strait of Hormuz, according to Trump."We received a 10 point proposal from Iran, and believe it is a workable basis on which to negotiate," Trump said in his post. "Almost all of the various points of past contention have been agreed to between the (US) and Iran, but a two week period will allow the agreement to be finalized and consummated."Trump had previously set an 8 pm ET deadline on Tuesday for Iran to fully reopen the strait or face destructive military attacks.In a separate statement shared on X, Iran's Foreign Minister Seyed Abbas Araghchi said Tehran will halt its defensive operations if attacks against it are stopped. Iran will also allow "safe passage" through the Strait of Hormuz, a key route for crude flows, during the two-week ceasefire through coordination with its armed forces and "with due consideration of technical limitations," according to Araghchi.Pakistan has invited US and Iranian delegations to Islamabad on Friday to further negotiate a "conclusive agreement to settle all disputes," Sharif said on X. Reuters reported earlier in the week that Pakistan put forward a proposal to both countries for an immediate ceasefire followed by a broader agreement to permanently end their war.The US-Israel war with Iran began at the end of February, disrupting shipments through the Strait of Hormuz and driving up energy prices. The conflict spread across the Middle East, with Gulf countries forced to intercept missiles and drones fired by Tehran.West Texas Intermediate crude oil dropped 16% to $94.39 a barrel in premarket action, while Brent fell 14% to $94.18.The Fed is scheduled to post minutes of its last policy meeting at 2 pm, which will be assessed for fresh insight on the central bank's monetary policy. Last month, the central bank held interest rates steady, saying the Middle East conflict poses uncertainty to the US economic outlook.Markets widely expect the Fed to keep its benchmark lending rate steady at its next policy meeting later in April, according to the CME FedWatch tool.Treasury yields plunged before the open, with the two-year rate declining 9.7 basis points to 3.74% and the 10-year rate falling 9.5 basis points to 4.25%.Wednesday's economic calendar also has the weekly mortgage applications bulletin at 7 am, followed by the weekly EIA domestic petroleum inventories report at 10:30 am.Delta Air Lines (DAL) and RPM International (RPM) report their latest financial results before the bell, among others. Constellation Brands (STZ) releases its earnings after the markets close.Shares of Levi Strauss (LEVI) jumped 11% pre-bell as the denim maker lifted its full-year outlook. Palo Alto Networks (PANW) inclined 2.1% while Trade Desk (TTD) was up nearly 4%.Gold gained 2.5% to $4,800 per troy ounce, while bitcoin climbed 4.3% to $71,663.

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